Funny how the market breaks just when everyone has finally made the transition from 'sell rallys' to 'buy dips'...
This is a nice start to the day to the nearest support at 980ish, and likely to break - the big problem, for bears, is that the 'buy dips' will likely keep the market from a true free-fall, at least for the first few failed rallies.
I expect the first support at 980, then 970 and would be surprised if 970 doesn't give us our first rally attempt.
4 comments:
This move won't go lower than 970 and us bears will be lucky to get that. I think the gap fill at 978 is all we can hope for during this move down. The NYSE McClennan will be at one of the most oversold points of the year at that point and the higher quality stocks will have completed catch up to the weaker stocks over the past week. Those 2 factors combined have been enough for this market to stage some kind of rally.
My hope is this dip buy only gets them back up to the 1000-1008 level before they can collapse down below 950.
Well, here's the 1000 level. And none of us have any faith the bears won't rollover, do we??
I have to admit I'm surprised how quickly we got back to 1000....
cue rolling over bears...
It's this McClellan Oscillator - as soon as we pull back 40 points it gets deeply oversold. I can't even figure out where this ends at this point - but hoping for a late afternoon selloff today. Late afternoon Friday selloffs are very rare - the market generally keeps chugging to close at the highs of the day.
In the absence of a selloff, there are 2 things scary for the bears here:
1). The McClellan isnt even close to the high end of overbought.
2). The lower quality stocks haven't moved since the low at 980 which indicates if the market holds here, they will rotate into these stocks pushing the market well higher. We saw this at 950 around 7/21.
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